What Funds Media? Can Government Subsidies Fill the Void?

1) Public media & subsidies can play a role, but that role should be tightly limited

Should be focused on filling niches

bottom-up (community-based) efforts are probably better than top-down proposals, which will probably end up resembling Soviet-style 5 year plans

regardless, public subsidies should not be viewed as a replacement for traditional private media sources

And I certainly hope we are not talking about a full-blown "public option" for the press along the lines of what Free Press, the leading advocate of some sort of government bailout for media, wants.

2) Indeed, public financing would not begin to make up the shortfall from traditional private funding sources

Free Press wants a $50+ billion endowment; would produce annual funding of $1.5 billion. But this is a drop in bucket compared to aggregate private media expenditures which total in the hundreds of billions each year

$270 billion spent on advertising in 2008

according to the Census Bureau, when aggregated together, U.S. "information industries" include over140,000 establishments and have over 3.3 million employees. And the publishing industries alone (not including the Internet) are a $300 billion a year sector.

are public subsides going to fill that void?

and where will all this money come from in tight fiscal times!

does Congress or the taxpaying public really have the appetite for massive media bailout? It seems unlikely.

3) Shouldn't force taxpayers to foot the bill for things they might not want or find offensive

Should liberals be forced to help fund the next Fox News or Rush Limbaugh?

Should conservatives have to support Keith Obermann or Bill Moyers?

4) Greater government involvement--even in the form of subsidies--will raise profound questions about press independence & First Amendment rights

Ken Ferree on FCC's "Future of Media" public notice: "The problem is that the very act of initiating such an inquiry will chill protected speech; government inquiries into what is and is not working in the area of news, information, and media is itself an affront to the First Amendment. And it is no answer that the Commission has embarked on this journey with beneficent motives, it has no power to derogate from the protections of the First Amendment in the name of what one group of bureaucrats may think are important government interests."

Chilling effect could be very real... "Regulation by 'raised eyebrow' has become a well-established tool for a number of federal agencies, including the FCC, but with this inquiry the Commission has taken the concept to a level heretofore unknown - this inquiry is regulation by penetrating leer." - Ken Ferree

In particular, putting journalists on the public dole, as some like Free Press have advocated, compromises their independence [Free Press has proposed "a journalism jobs program to support veteran, qualified reporters and simultaneously to engage young people in journalism" that would be part of AmeriCorps.]

The prospect of a large swath of the American media sector being treated as publicly funded wards of the State isn't just a small leak in the important wall between Press and State, it is the end of that wall. It would dynamite that wall to the ground. It could potentially open the door to a fundamental corruption of the journalistic profession by public officials who would not likely be able to resist the urge to pressure those who are subservient to the State.

5) Oh, by the way, where exactly does the FCC and FTC derive the authority to be playing these games?

Sure, they're just studying the issue. But neither agency has the power to act expansively in this area, yet both agencies can simultaneously threaten media operators with other forms of regulation. Such indirect intimidation could have the chilling effect mentioned previously

What Can Be Done to Promote Journalism / Assist Media Operators?

1) First, Do No Harm... Be patient and humble.

We are in a gut-wrenching evolution with a great deal of creative destruction taking place, but we should be careful to not to head off potentially advantageous marketplace developments, if even some are highly disruptive

2) Exercise extreme caution re: new or existing public interest regulatory obligations, which won't make media reinvention any easier

localism requirements

educational programming mandates / advertising restrictions

political airtime or advertising regs

speech controls

other public interest requirements

3) Beware new advertising restrictions at both FCC & FTC

If the complaint is that private media funding streams are drying up or being fragmented, crippling advertising is the last thing we should be doing!

And yet, there's a plethora of new regulatory proposals pending; many fronts in "Washington's war on advertising"

continues to put pressure on re: marketing of violently-themed entertainment to children

now stepping up oversight of online product placement or "blogola"

there's also legislation pending that would require the FTC to regulate "advertising, promoting, and marketing directed at children and youth" to promote healthier lifestyles

Regardless of how well-intentioned these or other regulatory efforts may be, as the FCC & FTC continue their inquiries into the future of news and journalism, they would do well to remember that an attack on advertising is tantamount to an attack on media itself

If Washington goes to war on advertising, private media will suffer because advertising is the very mother's milk of private media in this country.

Biggest threat of all = Free Press is calling for "small tax" on advertising to fund public media programs

in other words, FP wants to tax private media operators to fund public media competitors

Now there's a sure-fire way to destroy private journalism... force private media providers to fund their own, publicly-subsisted rivals!!

It's precisely what the French, masters of socialized media, have recently proposed

4) Gov't must be willing to allow business model flexibility

micropayments

paywalls

other subscription-based schemes

more personalized, targeted, and potentially more profitable, advertising

even if they don't work, experimentation must be allowed

5) Ownership flexibility needs to be part of the solution

It's no silver bullet, but essential to allow flexibility to determines what works

6) Non-profit BUT non-governmental options should be allowed

But non-profit status shouldn't come with all sorts of strings attached

Ex: Sen. Cardin's "Newspaper Revitalization Act," which would forbid political editorializing in exchange for non-profit status. It would protect incumbents from criticism.

and, again, ownership flexibility will need to be part of this for non-profits to work